Why the Premier League needed Amazon Prime

Why the Premier League needed Amazon Prime

After months of behind the scenes negotiations, the final two Premier League television packages for the 2019 deal have been sold. BT Sport increases its number of matches to 52 per season for the three-year deal. The big news is Amazon securing the 20 game package which comes with the caveat of showing every game across two distinct game weeks.

One of those is the first round of midweek fixtures in December. This is Amazon’s warm-up. It’ll give Prime Video the chance to iron out any teething problems and also enable them to gather data on viewing habits. Presumably, the initial ten games will be split across two nights in order to maximise the exposure.

The jewel in the crown of this deal is how Prime will show all the Boxing Day fixtures.

Festive games are a staple of the English diet, it makes fan interaction and acknowledgment of Amazon unavoidable. Many will flock to their local pubs, so how Amazon deal with public licenses is something that will be revealed in time. Amazon’s main intention will be to drive new subscribers to their packed Prime offering. Streaming is just a small part of this but they obviously see the Premier League deal as a decently priced advertising campaign.

It’ll certainly offer better value for money than Jeremy Clarkson’s The Grand Tour. That particular show cost Amazon a neat $250m, with BT paying an extra £90m for the less lucrative 20 game package, it’s safe to assume Prime’s acquisition will exceed the £100m mark.

But it might not be by that much. The reason these deals have taken so long to conclude is because their value is a true unknown quantity for all involved. There’s a chance this style of broadcasting, showing every single match from one round of fixtures, will never work with a UK based audience. From Amazon’s point of view, will enough people stream a potential Wolves v Huddersfield clash to justify the attempted push for subscribers?

The idea of Internet channels is growing in the States. Facebook and YouTube now have subscription models and Amazon have aired sporting events already. The Premier League is right to join an emerging market. More than this: it needs to join the platform and make it a success.

When the last TV deal hit revenue of £8.8bn (once overseas rights had been added), there was a growing feeling the peak return had been hit. The £5.14bn from domestic rights didn’t go back to the fans paying at the turnstiles or into grassroots football, it went into the pockets of agents and inflated the global transfer market.

At the time, BT and Sky were locked in a battle for broadband subscribers and addons like sport packages became a premium. BT had already stolen the UEFA Champions League, they wanted a slice of Premier League pie too. Back then, a customer had to juggle multiple subscriptions, even going to the extent of having two boxes plugged into televisions, one for Sky, the other for BT.

That all changed in December 2017 when the companies announced they had come to a deal, allowing them to sell complete packages with both sets of properties merged. Not only could they sell all-in-one sports deals, BT was even able to offer Sky’s Now TV channels which includes the home for Game of Thrones, Sky Atlantic.

Any doubt the peak of what Sky and BT would pay for Premier League matches was removed. Rather than push the prices up, they could now take a more measured approach. Exclusivity wasn’t quite so exclusive. It was no longer a case of one or the other, they’d formed a necessary alliance of sorts.

They could see what was on the horizon: a new world where Amazon or Netflix or even Twitter and Facebook, could offer live games with lower running costs.

So Sky did what Sky does best and tried to bully its way to the result it wanted.

By not engaging with the Premier League over the prospect of streaming all the matches in a particular round of fixtures, it fronted them out. It risked the proposal of a seven-package system falling by the waste side. Had that occurred in 2018, the chances of a later revival would have been highly unlikely.

The Premier League continued the talks with Amazon because it understands the existing Sky monopoly runs the risk of adhering to the law of diminishing returns.

When the sponsorship model was dropped it was a step toward becoming the football equivalent of the NFL or Major League Baseball so its quite fitting they have hooked up with a company that has a foothold in the American market.

Time will tell if this marks a change in how the UK views domestic football but evidence suggests a paradigm shift is already underway.

Research by SMG Insight found that 54% of millennials have watched an illegal stream and 18 to 24-year-olds are half as likely to subscribe to a paid model. The cheap Prime versus expensive Sky offering could convert some of those into legal consumers. With all of Amazon’s 20 games falling within December, those unsure could take out a one-off monthly subscription of £7.99.

If they watch just two games, it’s still trounces BT and Sky in terms of value for money. If some of those experimenters stick around, boosting Amazon Prime’s subscription numbers, it may make the retail giant – and rivals like Netflix – take a serious look at the other packages next time bidding starts.

Which would be great news for the Premier League. At the moment Sky hold all the cards because the give all the money. If people enjoy Prime’s Boxing Day extravaganza, next time the bespoke TV deals might not be on sale at Boxing Day Sale prices, the traditional packages may climb upward again.

And Sky might not be left holding all the best gifts.

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Accrington Stanley, Who Are They?

Accrington Stanley, Who Are They?

A catchphrase made famous from a milk advert before the Premier League existed, and best sums up attitudes displayed by that organisation this week. Accrington Stanley’s chairman, Andy Holt, attempted to highlight how life in the lower leagues was a struggle while those in the top flight lived in luxury. The response: a veiled threat to remove all financial support for Stanley and the other members of the EFL.

Mr Holt also suggested in this tweet, that the Premier League was a destructive force:

To begin with, let’s deal with an insinuation the Premier League levelled at Andy Holt. Since the new TV deal (with oversea rights, this now exceeds £8bn) the Premier League upped its contribution to the EFL and grassroots football by 40% to £1bn. Okay, that sounds a very large figure but it needs be placed into context.

The increase in TV revenue was 70%, so already there is a disproportionate redistribution of money. On the bottom line, the Premier League donates a smaller – albeit larger final sum – percentage of its revenue to those below them in the nation’s football pyramid.

Of that £1bn “donation,” the majority of it actually goes to teams relegated from the Premier League in the form of parachute payments. Suddenly that large cake on the table has a big chunk missing.

Before the deal, 3% went to grassroots, now the twenty clubs in the top flight agree to invest £112m a year into this programme. Again, context is required here. Grassroots is a place the top clubs circle like predatory sharks without fronting the sizeable bill. Between them they can just about muster £112m when Manchester United alone are willing to give an agent £41m for a single transfer.

This is where Andy Holt’s fears about the state of football hold the most water. Top clubs are able – and have no qualms – to allow money to leak from the game. Just as boxing promoters act as vampires on the sport, financially benefiting from the skill of others as the grassroots decay, football agents walk away with money that could prop-up entire divisions.

With the best fiscal management in the world, the harsh reality for lower league clubs is a yearly battle with rising costs and increasing debts.

The Premier League has gone past the tipping point when it comes to moral obligations. The desire to be the NFL of soccer has made it lose sight of certain facts. The NFL model works because there is nothing beneath it other than college football.

By the time the Premier League is finished, there won’t even be suitable football training in our schools. They have allowed a cancer to enter the revenue stream of the beautiful game and failure to ignore the final cries for help from people like Andy Holt, is like refusing lifesaving treatment.

Such is the arrogance and disconnect with the real world, the Premier League thought ensuring all staff members at top flight clubs were on the minimum living wage was a show of grace. It was the absolute least expected.

It has made no efforts to control ticketing prices for fans, meaning the working-class man in the terraces hasn’t seen the benefit of increased revenue passed down to him.

Too many clubs in the EFL, like Leeds, Blackburn, Nottingham Forest, cripple under their own weight as they take massive infrastructure into a landscape that can’t provide. It’s a wonder teams haven’t already started dropping out of existence. But that day will come, and it will affect the big and the small in the EFL, because they all have one thing in common: they have been made to sit on the poor table.

The tone of the Premier League’s reply gives the impression they enjoy teams coming to them like Oliver, bowl in hand, begging for more.

The Premier League has forgotten that the football pyramid in this country used to be a symbiotic relationship. That’s what the FA Cup used to symbolise: all ninety-six professional teams and all the non-league ones below that enter, on a level playing field of equal importance.

Nowadays the notion is played with by the Premier League in the same way a cat toys with a dead mouse. The idea of a shared national game is just a novelty to those at Lancaster Gate. They’re not bothered about Andy Holt’s opinions on the matter because they’re not bothered about the EFL, grassroots, or Accrington Stanley.

Who are they?

Exactly.

 

EFL Short-sighted

EFL Short-sighted

The English Football League (EFL) demonstrated ignorance and a lack of understanding with wider issues this week, in doing so it deepens a rift between its member clubs and the administration of the EFL. The much derided EFL Trophy, now renamed Checkatrade Trophy, was always a bone of contention. Now the fears of lower league clubs have been manifested in the form of ridiculous fines.

The concept of the revised EFL Trophy was after the lower tiered Football League clubs spoke out against the proposed League Three option, fearing the inclusion of Premier League B Teams would be a further example of looking after the big clubs at the expense of those without. Also, it would have damaged the accessibility of the current loan system.

The Football Reflective was a fan of the idea (Fair and Three) as it took a holistic view. The current loan system hasn’t proven to be beneficial for the donor clubs. Aside from Manchester City, who appear to frequently send their coaches to assess and assist those loaned out, once a player has left the nest they are under the guidance of lower grade coaches using lesser facilities.

The FA, after years of mounting evidence that suggests the national team has a bleak future, is desperate for a solution. When League Three was written off, they needed a halfway house. A trial to see if there would be the appetite for B Teams to mix in competitive ties with lower league clubs.

They took the essence of a good idea and managed to turn it against itself.

The EFL Trophy in its former guise was a good opportunity for the teams from the bottom two tiers to have a day out at Wembley. Not many cared for the competition until that chance was on the horizon, but when it appeared a play-off final vibe arose.

Adding select upper league clubs’ under-21s to the mix destroyed that slight fantasy. The idea of Stoke U21s v Wolverhampton U21s at Wembley doesn’t have any of the romance. All it would do is confirm to the smaller clubs that football in this country only cares about those higher up the league pyramid.

But the clubs that bemoaned the idea of League Three do need to take some responsibility. Their fears have turned into a self-fulfilling prophecy, acted out during the EFL Trophy.

Most blame has to go to the EFL itself. This week they fined twelve clubs, ranging from £3,000 to £15,000 each, for fielding weaker sides(five players must have appeared in the previous game, or contain the five most used players from the season as a whole). A format they didn’t trust has now hit their pockets.

Luton chairman Gary Sweet summed up the disparity best when he remarked he shouldn’t be paying fees to give his youth players experience. To make matters worse, his club’s youth defeated a side from the higher tier. So, is the Checkatrade Trophy only about developing youth players from big clubs?

The fear of the voiceless now realised with the opening of a cheque book.

The EFL Trophy fines come at the same time as talks to restructure the EFL to four leagues of twenty teams collapsed. Here the clubs and league are equally short-sighted. Chief Executive of Shrewsbury, Brian Caldwell, has been one of the most outspoken against. His concern, one mirrored up and down the country, was a reduction in fixtures would mean less money.

The EFL countered this by promising more Saturday fixtures, seen as a way to avoid the lesser attended midweek matches, claiming this would actually increase overall revenues. That plan was supposedly scuppered by the FA’s latest oversees TV deal for the FA Cup. The weekends they’d planned to use are now locked in for FA Cup ties.

By removing themselves from the negotiating table too soon, the EFL has failed to see its strong hand. Without the EFL clubs there is no FA Cup. The football league could have driven the demands for better distribution of wealth and proceeded with the reformation of its structure.

Not compromising for a few FA Cup weekends means its platform stays stuck in the past.

The Championship may be the fifth most watched league in the world but it has the weight of the entire lower tiers on its shoulders. It can’t thrive unabated like the Premier League, there is a glass ceiling imposed due to the EFL’s overall structure. It may carry the load but it is the EFL that should shoulder the burden.

Doing nothing will only see the gap between the haves and the have-nots grow.

By being overly defensive of the FA and Premier League’s intentions, the EFL and its members have only spited themselves. If the road to Hell is paved with good intentions, the road to obscurity and obsoletion is paved with paranoia.